Recent industrial output data from China has revealed that refiners scaled back their activity in November. The amount of crude processed during that month dropped to its lowest level in five months, reaching approximately 14.3 million barrels per day. This decline occurred as some processors shut down their plants for seasonal maintenance. Cumulatively, the apparent demand has fallen by 3.3% year-on-year to 14 million barrels per day over the first 11 months of the year, as pointed out by ING’s commodity analysts Ewa Manthey and Warren Patterson.
In the United States, the latest figures from Baker Hughes indicate that the number of active oil rigs remained unchanged over the past week at 482, following an increase of five in the previous week. Meanwhile, the total rig count, combining both oil and gas rigs, also stayed steady at 589 during the reporting week. Primary Vision’s frac spread count, which offers insights into completion activity, decreased by three over the week to 217.
Weekly positioning data from the Commodity Futures Trading Commission (CFTC) shows interesting trends. The managed money net long position in NYMEX WTI took a dip after rising for two consecutive weeks. Money managers reduced their net longs in NYMEX WTI by 12,448 lots over the week, leaving it at 103,986 lots as of 10 December 2024. On the other hand, exchange data reveals that speculators have opened new long positions of 5,349 lots in ICE Brent over the last week, resulting in a net long position of 162,273 lots.
When it comes to oil products, the net bullish bets for gasoline have surged to their highest level since mid-April 2024. Speculators increased the net longs for gasoline by 6,546 lots (after reporting declines for two consecutive weeks) to 73,037 lots for the week ending 10 December 2024. There are indications that the gasoline supply could tighten next year due to planned refinery outages and closures. Notably, LyondellBasell’s Houston refinery is slated to close by the end of the first quarter and will start idling as early as January. This refinery processes around 264,000 barrels per day.
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